SWM ETF portfolio fact sheets, October 2020: major outperformance in market correction

In a month where global equities lost over 2%, SWM’s ETF portfolios with ESG focus saw only minor declines. Our equity-containing ETF portfolios outperformed their benchmarks by between 1% and 2% in October, bringing year-to-date outperformance to between 7.6% and 12%, these are record levels. This continues our long-running trend of generating significant outperformance in every ETF strategy (details on p.2 of the fact sheets).

The drivers of November’s outperformance were threefold: 1) strong, positive performance from several of our core ESG ETFs (notably our solar power, wind energy and water ETFs); 2) our underweight position in European equities paid off, this was by far the weakest region in October 2020; 3) a very strong increase in the small cryptocurrency position that our portfolios hold. Following October’s correction, equity markets are now looking oversold. Short-term volatility is likely following the US election tomorrow. However, our intermediate-term signals are strongly positive for equities, and we would recommend adding to equity holdings at current levels. Overall, we have a Neutral weighting in equities.

Please follow this link to read Secure Wealth Management’s monthly ETF portfolio review for October 2020.